Local Exchange Trading System

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Local Exchange Trading System, or LETS for short, is a local currency system for exchanging goods and services within a community. LETS started in Canada in the 1980s and is used in many regions around the world.

LETS typically focus on one region or community and allow transactions among its members. This is intended to stimulate local economic activity and enhance social cohesion.

The system works as follows

Participants list the goods and services they can offer. This may include handmade products, special skills or expertise, or general labor.

These goods and services are traded in a local currency created by LETS, rather than in regular currency. This allows participants to purchase goods and services from other participants using the currency.

Transactions are generally based on credit, and borrowing and lending are usually regulated by community rules.

The main advantages of LETS are

Stimulate the local economy: Local currency is used locally and encourages the exchange of local products and services.

Strengthening Communities: LETS provides opportunities for people to connect and support each other.

Mitigating the effects of financial crises: Local currencies may help protect local economies from general financial system problems.

Equal access: LETS allows people with little cash to exchange goods and services.

However, LETS also face challenges and problems. They include difficulties in administration and organization, determining appropriate values, lack of liquidity, and lack of participation.

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